Postal Service unveils its plan to reduce costs

Tuesday

Mar 30, 2010 at 12:01 AMMar 30, 2010 at 12:00 PM

MCCLATCHY NEWSPAPERS

WASHINGTON — The long talked about demise of Saturday mail delivery would become a reality early next year under a wide-ranging U.S. Postal Service cost-cutting blueprint unveiled yesterday that would also slash thousands of front-line jobs.

“Given the fact that we’re facing such a huge deficit, we’d like to move as quickly as possible,” Postmaster General John Potter told a news conference.

Faced with a projected $238 billion deficit over the next decade, the Postal Service board of governors approved the cuts last week and ordered Potter to submit the proposal to the Postal Regulatory Commission today.

In addition to cutting one day a week from the delivery schedule, the proposal would eliminate the equivalent of 49,000 full- and part-time jobs, about 8 percent of the current work force of 600,000. Officials said the changes would save the Postal Service a projected $3.3 billion in the first year and about $5.1 billion annually by 2020.

Under the plan, mail carriers would stop street deliveries to U.S. homes and businesses on Saturdays as well as pickups from blue collection boxes. Mail would still be accepted at post offices on Saturdays but wouldn’t be processed until after the weekend. Express mail and remittance mail services would continue to run seven days a week.

If approved by Congress and the regulatory commission, officials said they hoped to implement this plan by the first half of 2011. Congress currently mandates delivery to all U.S. addresses six days a week.

Potter said the Postal Service would eliminate about 26,000 positions through employee attrition and lay off 13,000 part-time workers, most of whom carry the mail once a week as substitutes. He said the high attrition rates are only possible because mail carriers on average are 53 years old and most have pension arrangements that would allow them to retire at 55. About 10,000 mail carriers retire each year.

Continuing declines in mail volume also made changes necessary, Potter said. American mailboxes currently receive an average of four pieces of mail each day, but projections show this might decline to three a day by 2020.

A spokesman for the National Association of Letter Carriers said the union opposes the service and job cutbacks, and pointed to a recent report from the Postal Service inspector general that indicated the agency was pouring billions of dollars more than it needed to into retirement funds.

“The Postal Service needs to focus on reforming its pension costs instead,” said Drew Von Bergen, the union spokesman.

A Postal Service spokesperson said the agency was open to any congressional action that could lead to a reduction in the scope of cost-cutting measures. However, he said the Postal Service was nonetheless pushing ahead with plans to significantly reduce its operating costs.

Sen. Tom Carper, D-Del., who chairs the Senate subcommittee panel that oversees postal operations, said earlier this month that he supports cost-reduction plans. Carper’s office said yesterday that a panel hearing is tentatively scheduled in April to consider Postal Service finances.